Holding pride of place above my desk is a cutting from a right-wing blogger writing about one of my pamphlets and complaining: “isn’t it annoying when Lefty think tanks get it right?” I was reminded of this whilst reading the latest Conservative ‘green’ paper on local government. The paper is flawed in many areas but offers enough radicalism to make Labour politicians around the country sit bolt upright. And if the government is smart, it will implement the good bits of it as soon as possible.

The first thing to say about the paper is that it is contradictory. It claims to want to give local councils greater freedoms, whilst insisting that council tax rises must be dependent on a referendum. Can you imagine if national government had to ratify every tax increase by such a public poll? Moreover, the paper bemoans the number of unelected quangos established by Labour, but then commits a Conservative government to setting up a body to oversee how much money councils receive from the Treasury, a decision currently made by the government in consultation with local councils.

There are however measures to give Labour in local government food for thought. Plans, though somewhat sketchy, to allow local authorities to allow discretionary business rate discounts could be an excellent tool in helping areas to regenerate and encourage inward investment. A council leader could then be able to offer lower business rates to, say, a new business park or new college and create new growth and jobs locally.

Similarly, proposals to hold referendums for directly elected mayors in large cities could help to revitalise civic leadership in England. Elected mayors are by no means a panacea, and there are some excellent council leaders up and down the country, but the mayoral model should at least be considered as a different form of governance. Just as city mayors are commonplace in Europe, a mayor of Birmingham, Newcastle or Liverpool could help to offer a new form of leadership. From Labour’s perspective, the model also offers the best chance of taking back control of many lost cities.

Plans to downscale or remove elements of regional government are also short-sighted, especially at a time when businesses are benefitting from RDA support during the difficult economic period. The Conservatives will also have to explain how long-term strategic decisions that cross local authority boundaries can be made without any regional coordination. However, the general theme of returning power from unelected quangos to elected local government may well prove electorally attractive to voters and is one area which Labour needs to counter. There would be no harm, for instance, in a government review of which powers currently held by quangos could be returned to local government.

Labour has made significant strides in devolving decision making to a local level and reversing some of centralising shackles imposed on councils during the previous Conservative government. However, it should take seriously some of the pragmatic reforms advocated in the green paper rather than repeating a tired mantra about the threat of “Tory cuts” to public services.

If Labour is to rebuild its dwindling base in local government it needs a new approach to how it does politics. Though full of holes, the Conservative paper displays an element of vision mixed with some sensible ideas and should act as a catalyst – a wake up call – for fresh thinking within the Labour party.